The Trump administration has imposed a 25% tariff on certain advanced artificial intelligence semiconductors, while simultaneously clearing the way for U.S. chipmakers to resume limited sales of high-end AI processors to China, marking a nuanced shift in Washington’s technology and trade policy.
Under a proclamation signed Wednesday, the tariff applies to advanced AI chips that are manufactured outside the United States, routed through the U.S. for testing or verification, and then exported to customers abroad. Among the affected products are Nvidia’s H200 AI processor and AMD’s MI325X, both designed for data-intensive AI workloads. The action follows a months-long national security investigation conducted under Section 232 of the Trade Expansion Act of 1962, according to the White House and the Department of Commerce.
Administration officials framed the move as part of a broader effort to strengthen domestic semiconductor manufacturing and reduce U.S. dependence on foreign supply chains, particularly those centered in East Asia. The proclamation notes that the United States currently manufactures only about 10% of the chips it consumes, a reliance the administration describes as both an economic and national security risk.
Despite the new tariff, Nvidia welcomed the decision because it formally allows the company to ship H200 chips to vetted Chinese customers starting later this year. The chips must undergo independent, third-party testing in the U.S., and exporters are required to certify that sufficient supply remains available for U.S. customers. Shipments to China will also be capped relative to U.S. volumes.
“We applaud the administration’s decision to allow America’s chip industry to compete while supporting high-paying jobs and manufacturing in the United States,” an Nvidia spokesperson said, adding that the policy strikes a balance between national security concerns and commercial competitiveness.
President Donald Trump emphasized that the H200 is no longer Nvidia’s most advanced product, noting that newer generations such as Blackwell and Rubin now exceed its performance. “It’s not the highest level, but it’s a pretty good level,” Trump said, adding that the U.S. government would effectively capture 25% of the value through tariffs on the chips as they pass through the United States.
The White House said the tariffs are narrowly targeted and will not apply to chips imported for use in U.S. data centers, consumer electronics, civil industrial applications, or public-sector projects. Commerce Secretary Howard Lutnick has also been granted discretion to issue further exemptions if deemed necessary.
Market reaction was muted, with shares of Nvidia, AMD, and Qualcomm trading slightly lower in after-hours trading following the announcement. Industry observers say the limited scope of the tariffs suggests a cautious approach by the administration, even as it signals the possibility of broader semiconductor duties in the future to encourage domestic production.
Meanwhile, demand from China remains strong. Nvidia executives have said interest in the H200 from Chinese customers is “very high,” prompting the company to restart production. However, uncertainty remains over how Chinese regulators will respond, as Beijing continues to promote domestic chip alternatives while seeking to avoid falling behind in the global AI race.
The administration has indicated that additional semiconductor and derivative-product tariffs could be considered in the coming months, underscoring that Wednesday’s move may be an opening step rather than the final word on U.S. chip trade policy.
Sources: White House proclamations and fact sheets; U.S. Department of Commerce filings; statements from Nvidia and AMD; reporting by CNBC, TechCrunch, Nikkei Asia, and other major financial news outlets.
15-01-2026
